This week’s Budget was getting it wrong, not ‘getting it done’

John McDonnell

It’s been just a few days since the government’s first Budget and there’s an emerging consensus that, once you scratch beneath the surface of the slogans and the spin, it’s a disappointing package overall. Despite what the Chancellor Rishi Sunak boasted on Wednesday, this looks like a Budget where the government’s getting it wrong, not getting it done.

On coronavirus, we have said we will support constructive measures, and work alongside NHS professionals and scientific experts to defeat the outbreak. But the announcements on coronavirus, adding up to £12bn in funding, were all too vague on Wednesday, full of holes, and didn’t go far enough. No clarity on how much of the £5bn public services package would go to the NHS or social care. No extension of statutory sick pay to zero-hours contract workers, part-time workers, and low-paid workers. No increase in the low rate of statutory sick pay, leaving people choosing between health and hardship. No action to tackle the five-week delay in receiving Universal Credit, which the government is relying on in its response. No full explanation for why the government doesn’t have a more comprehensive plan for coronavirus testing or social distancing, which has left many vulnerable people – and indeed all of us – increasingly anxious.

Tory underfunding of public services has left them ill-prepared to deal with a crisis like this. The NHS has been underfunded over a decade of decline, and now has 17,000 fewer beds. 1.5 million people were not receiving the social care they need before this outbreak, with more than 120,000 staff vacancies in the social care system. And yet we heard complete silence from the government on a long-term solution to social care, despite years of the Tories promising white papers and green papers. The Chancellor said “over the next few months, we will tackle the big issues” like social care. That’s not getting it done. That’s getting it wrong.

The Tory austerity experiment is now a proven failure. This Budget is an admission of failure, even if the Tories don’t have the honesty to openly admit it. George Osborne said in a speech in 2009, citing work from the IMF, that “fiscal policy is more or less powerless to affect output” in open economies. In other words, he didn’t think government spending could increase growth. He thought the way to rebuild growth was to reduce the size of government. The OBR this week contradicted George Osborne in their analysis accompanying the Budget. They said “a large planned increase in public investment should boost potential output”. The Tories got it wrong in 2010 – fundamentally wrong. They’ve been getting it wrong for ten years.

Austerity continues in this Budget, despite all the hype. Spending levels are still below where they were in 2010-11, as the IFS has pointed out. Public services are not being restored, in the face of the urgent demands of those affected by the loss of services like youth centres, legal aid, family violence support, public libraries, Sure Start centres. Are the Tories ending austerity – and getting it done? No, they’re getting it wrong.

Infrastructure was hyped but it doesn’t fill the hole the Tories created. The Tories have trumpeted their infrastructure investment. But at most it appears the new infrastructure investment is about £143bn excluding depreciation – when the Tories created a £192bn infrastructure investment hole between 2010 and 2020. They are asking to be congratulated for only beginning to rebuild what they have destroyed. And they have no plan, with the National Infrastructure Strategy shelved until later in the year, and no grasp of how skills investment is needed to deliver on infrastructure promises. Again – getting it wrong, not getting it done.

The Budget is profoundly disappointing on climate change. There was no national infrastructure plan to shift the tracks on which the economy runs and move it towards a zero-carbon future. The IPPR’s Environmental Justice Commission said £33bn a year was needed in green investment just for the Tories to achieve their unacceptably unambitious target of net-zero emissions by 2050. That target wasn’t met, and instead £27bn was allocated to roads. No new support for wind and solar energy. No new measures to tackle the affordability of public transport. No action to decarbonise how we heat our houses – just a consultation on action for 2022. Getting it done? On the existential threat of climate change, this government is also getting it wrong.

All eyes are now rightly on the coronavirus crisis. That will require all of government, and all of us, to pull together. But I regret to say that in this Budget the Tories have postponed, prevaricated, and prevented government from being well-equipped to deal with the crises of our time. Getting it wrong, not getting it done.

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